Did you know that your home equity can play a meaningful role in reducing the overall risk of your retirement plan? For years, the home was often left out of the financial planning conversation, but that’s starting to change. More retirement experts are recognizing that using home equity through a reverse mortgage can be a valuable and underutilized strategy.

Let’s take a quick look at where many seniors currently stand when it comes to retirement readiness:

• Only 22 percent of workers are very confident they’ll have enough money saved for retirement
• 45 percent of Americans have no retirement savings at all
• Women are expected to live an average of 20 years beyond retirement, two years longer than men
• The average retiree will face approximately $220,000 in out-of-pocket healthcare costs
• Medicare typically covers only 62 percent of senior healthcare expenses, leaving 38 percent to be paid out-of-pocket
• 36 percent of near-retirees will rely solely on Social Security for income

Given these realities, a reverse mortgage can help address financial gaps in retirement. How the funds are used is entirely up to the borrower. Whether taken as a monthly payout, a line of credit, or a combination of both, reverse mortgage funds can be integrated with other retirement tools to provide added financial stability during the retirement years.

Reverse mortgages are available to homeowners aged 62 and older, including married couples. These loans allow borrowers to live mortgage payment free while continuing to own their home. Because reverse mortgages are federally insured and non-recourse, neither the borrower nor their heirs will be responsible for repaying more than the home is worth. There are also options for adult children or family members who may wish to keep the home in the family after the borrower passes.

For seniors looking to strengthen their retirement strategy, home equity may be one of the most overlooked—but powerful—tools available.

Jan Jordan and Kelsey Jorck are Reverse Mortgage Specialists serving Fort Collins, Loveland, Greeley, Longmont, Dacono, Erie, Boulder, and surrounding areas across Colorado’s Front Range.  Click here to contact them and learn if reverse mortgage is right for you.